Question: Please do the arbitrage for part B 7. The price of a non-dividend paying stock is $19 and the price of a three- month European

Please do the arbitrage for part B

7. The price of a non-dividend paying stock is $19 and the price of a three- month European call option on the stock with a strike price of 20 is $1. The risk free rate is 4% per annum. a) What is the price of a three months European put option with a strike price of $20? b) You observe the market price of the 20-strike put to be $2.10. What arbitrage opportunities are there? What profit do you make and when? Show all cashflows in detail

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